Stocks, oil, and risk currencies gained on Tuesday as the formal go-ahead for US President-elect Joe Biden to begin his transition burnished a November already boosted by Covid-19 vaccines.
EUR/USD and its patterns
Information is not investment advice
EUR/USD stabilized last week around 1.1180. The price action seen at the H4 chart resembles an inverted “Head and Shoulders” pattern with a neckline at 1.1250. The size of the pattern assumes that the euro might be able to recover to 1.1320 area. The bigger resistance is at 1.1350 (100-day MA). This level will likely limit any possible advance of the euro and attract plenty of sellers.
At the same time, if EUR/USD slides below 1.1250, the targets will be at 1.1230 and 1.1190.
Volatility will be high on Wednesday due to the press conference of the European Central Bank at 15:30 MT time. Given the fundamentals, buy trades seem to be riskier than sell trades for the euro.
EUR/USD fell below 1.1850 after reaching 1.1920 on Monday. The pair consolidated after the initial bearish move.
USD/CAD remains within a downtrend. As a result, selling the pair as it turns down from resistance is the best strategy. Support lies at 1.3125.
Fed's Powell said a slowing recovery and a surging pandemic meant the US was entering a "challenging" few months, with the potential deployment of a vaccine still facing hurdles.
Investors are waiting for the significant decision of OPEC+ members to prolong oil output cuts or stop them.
The progress on the COVID-19 vaccines and hopes of a swift economic rebound next year added to the optimistic sentiment in the market.